Here are some of the factors that are determining factors of petrol prices in Chhattisgarh and India as well:
1. Price of Crude Oil
Changes in crude oil’s price at the international market directly influence its prices in the domestic market. Factors such as global demand for crude oil, production rate, and political relations in countries where crude oil is being imported affect crude oil’s price and, consequently, petrol prices.
2. Cost for Dealers
Oil Marketing Companies such as HPCL and IOCL levy a charge to dealers to distribute crude oil depending on factors such as refining expenses, freight charges, etc. This price levied by them is an important factor that affects petrol prices.
3. Excise Duty and Sales Tax
The Central Government imposes excise duty, and the State Government levies VAT on petrol. Both these taxes influence petrol prices in Chhattisgarh and across India.
4. Dealer’s Commission
OMCs provide a commission to petrol pump owners, which affects the petrol price in Chhattisgarh and the entire country.
5. Valuation of Indian Rupees Against US Dollars
The crude oil is imported from the international market, and the transaction is completed in dollars. Hence, any change in the exchange rate of rupees and dollars affects petrol prices in the domestic market.
6. Demand and Supply of Petrol
If the supply of petrol falls short of the increasing demand for petrol in the market, then petrol prices will increase as per the law of economics.